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fib_1618

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US Equity Markets:

The NYSE composite A/D line continued its steady climb above its accelerated rising bottoms line and finished the week at new all time highs. Given that the SPX pattern is now approaching longer term price resistance at the 1300 level, it will continue to be important for the bulls to flex their muscles near term if we're going to be able to move above this area of congestion that was maintained prior to the crash of 2008. Further strength above the 1325 area will then allow the price pattern to move to its next resistance area of around the 1400 level.



T
he NYSE common only A/D line is now 662 net advances away from making new all time highs. Could this level provide a potential resistance point, or with the high amount of liquidity keeping things buoyant, will we move through these highs like a hot knife through butter?? Stay tuned.



The NYSE preferred only A/D line continues its trek to higher highs...steady as she goes.



US Interest Rates:

As was the expectation from last weekend, the
NYSE Bond CEF A/D line did indeed break to the downside last week but hasn't as yet taken out its December lows. Given that the yield of the 10 year note is now resting on its rising bottoms line, if this A/D line can hold above last months lows, this could set off a break of the rising bottoms line of the 10 year yield, and from that, a potential bottom for this asset class group of products. Stay tuned.



US Real Estate:

The NYSE REIT A/D Line remains highly positive and could be on the verge of an upside acceleration both in breadth and price. Stay vigilant.



Precious Metals:

After a feeble attempt to snapback to or towards their previous trendlines, both the Precious Metals A/D line and XAU A/D line moved sharply to lower lows this past week. This kind of exhaustive behavior was all that was needed for the price of gold, and the XAU price index, to join with the direction of breadth and break their own rising bottoms lines providing a short term sell signal for the group in general. Potential price pattern support for gold comes in around the $1325 level, with the same structural support coming in for the XAU at 195. With the XAU index now at longer snapback support levels of its previous all time highs seen in 2008, the near term expectation would be for a rally to begin next week in what would compliment an attempt to snapback to or towards these same lines of support that were violated this past week. In any event, it would appear that it will be another 2-3 weeks before we'll see any semblance of a low in this asset group of products.






Australia:

The XAO A/D line moved a bit higher last week, but the big news was that the XAO price index found technical support and then moved to less than 100 points from its April 2010 highs. It should be noted, however, that breadth is lagging price to the upside, so it will be very important for the bulls to show some conviction near term or a price pattern reset back to last weeks price lows might be the result.



England:

The FTSE cumulative A/D line continued to move sideways this past week looking for direction, while as the same time, the FTSE price pattern moved to new recovery highs. This negative divergence between breadth and price will need to be righted quickly or we might be in store of a multi week correctional process.



Germany:

Like the London market, the DAX cumulative A/D line and DAX price index remain fully indecisive at the current time. As has been the case throughout this weekly review, it will be important for the bulls to "get off their indecision" and drive prices higher quickly or there will be the potential for this choppy behavior to continue for a couple more weeks.




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